Gilbert Manufacturing Company manufactures a special line of tools.

As of December 31, 2021, the Statement o

Gilbert Company
Statement of Financial Position
December 31, 2021
(In Pesos)
Assets Liabilitites and Equities
Cusrrent Assets Current Liabilities
Cash 150,000.00 Accounts payable
Accoutns receivable 220,000.00 Taxes payable
Inventories 592,000.00 Current portion of lo
Other current assets 23,000.00 Total current liabilitie
Total current assets 985,000.00 Long term liabilities
Total liabilities
Long-term assets Equity
Property, plant and 2,475,000.00 Share capital
Less: Accumulated de 850,000.00 Retained earnings
Net 1,625,000.00 Total Equities
Total Assets 2,610,000.00 Total Liabilities and Equities

The following information is available for the development of its Master Budget for 2022.

Estimated sales
Units 6,400
Price per unit P800
Finished goods inventory
Beginning 900 units @ 500
Ending 1,000
Work in process inventory
NONE

Raw Materials
Material
R S
Materials required per unit of finished product 3 units 5 units
Beginning inventory 2,200 4,000
Ending inventory 1,300 4,600
Unit cost P10 P30
Direct labor P146 per unit produced

Overhead is estimated as follows

Variable:
Indirect materials and supplies P5.85 per unit produced
Material shandling 9.07 per unit
Other indirect labor 5.07 per unit

Fixed:
Supervisor labor 175,000
 Maintenance and repair 85,000
Plant administration 173,000
Utilities 87,000
Depreciation 280,000
Insurance 43,000
Property taxes 117,000
Other 41,000

Marketing and Administrative expense are budgeted as follows:

Variable marketing costs:
Sales commissions P40.625 per unit sold
Advertising P16.250 per unit sold
Fixed marketing costs
Sales salaries P100,000
Advertising 193,000
Other 78,000

Administrative cost (all fixed)

Administrative salaries P254,000
Data processing services 103,000
Legal and other professional fees 180,000
Depreciation - building, furniture and equi 94,000
Taxes - other than income 160,000
Other 26,000

Additional information
The treasurer's office also provided the following information and estimates
1) All sales are on account and collection from customers are expected to amount to P5,185,000
2) Equipment costing P300,000 with accumulated depreciation of P275,000 will be sold at its net boo
3) Accounts payable will increase by P15,000 and assumed to be for materials purchases only.
4) Income taxes will be provided at an average rate of 35% of income before taxes while P252,000 w
5) Dividends amounting to P140,000 will be paid during the year and the current portion of the long-

Required:
Prepare the Master Budget for Gilber Company for the year ending 2022:
Sales Budget
Production Budget
Raw Materials Budget
Direct Labor Budget
Overhead Costs Budget
Budgeted Cost of Sales
Marketing and Administrative Expense Budget
Cash Budget
Budgeted Income Statement
Budgeted Statement of Financial Position
ember 31, 2021, the Statement of Financial Position of the firm is as follows:

Liabilitites and Equities

Accounts payable 140,000

Taxes payable 156,000
Current portion of lo 83,000
Total current liabilitie 379,000
Long term liabilities 576,000
Total liabilities 955,000

Share capital 350,000

Retained earnings 1,305,000
Total Equities 1,655,000
es and Equities 2,610,000
 ed to amount to P5,185,000
275,000 will be sold at its net book value. New equipment costing P320,000 will be purchased during the year.
materials purchases only.
e before taxes while P252,000 will be paid during the year.
d the current portion of the long-term debt shall also be settled at the end of the year. Interest rate is 8% per annum.
% per annum.
Gilbert Manufacturing Company manufactures a special line of tools. As of December 31, 2021, the Statement o

Gilbert Company
Statement of Financial Position
December 31, 2021
(In Pesos)
Assets
Cusrrent Assets
Cash 150,000.00
Accoutns receivable 220,000.00
Inventories 592,000.00
Other current assets 23,000.00
Total current assets 985,000.00

Long-term assets
Property, plant and equipment 2,475,000.00
Less: Accumulated depreciation 850,000.00
Net 1,625,000.00
Total Assets 2,610,000.00

The following information is available for the development of its Master Budget for 2022.

Estimated sales
Units
Price per unit
Finished goods inventory
Beginning
Ending
Work in process inventory
NONE

Raw Materials

Materials required per unit of finished product

Beginning inventory
Ending inventory
Unit cost
Direct labor

Overhead is estimated as follows

Variable:
Indirect materials and supplies
Material shandling
Other indirect labor

Fixed:
Supervisor labor
 Maintenance and repair
Plant administration
Utilities
Depreciation
Insurance
Property taxes
Other

Marketing and Administrative expense are budgeted as follows:

Variable marketing costs:
Sales commissions
Advertising
Fixed marketing costs
Sales salaries
Advertising
Other

Administrative cost (all fixed)

Administrative salaries
Data processing services
Legal and other professional fees
Depreciation - building, furniture and equipmen
Taxes - other than income
Other

Additional information
The treasurer's office also provided the following information and estimates
1) All sales are on account and collection from customers are expected to amount to P5,185,000
2) Equipment costing P300,000 with accumulated depreciation of P275,000 will be sold at its net boo
3) Accounts payable will increase by P15,000 and assumed to be for materials purchases only.
4) Income taxes will be provided at an average rate of 35% of income before taxes while P252,000 w
5) Dividends amounting to P140,000 will be paid during the year and the current portion of the long-

Required:
Prepare the Master Budget for Gilber Company for the year ending 2022:
Sales Budget
For 2022
Units Price per unit
Estimated Sales 6,400 800

Production Budget
For 2022
Target Sales
Ending Inventory
Total Units
Beg Inv
Units to be produced
Raw Materials Budget
3
R
Units for production 19,500.00
Ending Inv 1,300
Total unites required 20,800.00
Beg Inv -2,200
Units to be pyerchased 18,600.00
Unit Cots 10
Total Purchases 186,000.00

Direct Labor Budget

Units to be produced
Multiply: Direct Labor cost per unit
Total direct labor cost

Overhead Costs of Budget

Variable Overhead:
Indirect Materials and Supplies 5.85 per unit
Material Handling 9.07 per unit
Other indirect labor 5.07 per unit
Total Variable Overhead
Fixed Manufacturing Overhead:
Supervisor labor
Maintenance and repair
Plant administration
Utilities
Depreciation
Insurance
Property taxes
Other
Total Fixed MO
Total Manufacturing Overhead cost

Budgeted Cost of Sales

For 2022
R
Units Unit Cost
Raw amterials, beg 2,200 10.00
Purchases
Total Raw materials availabalbe for use
Raw Materials, End
Materials Used
Direct Labor
Manufacturing overhead
Total manufacturing cost
WIP
 Cost of goods manufactured
Finished gods, beg
Goods available for sale
Finished goods, end
Total Cost of Sales

Marketing and Administrative Expense Budget

Units Unit Cost
Variable Marketing Cost:
Sales commissions 6,400 40.625
Advertising 6,400 16.25
Total VMC
Fixed marketing costs
Sales salaries
Advertising
Other
Total FMC
Tital Marketing Cost
Administrative cost (all fixed)
Administrative salaries
Data processing services
Legal and other professional fees
Depreciation - building, furniture and equipment
Taxes - other than income
Other
Total Administrative cost
TOTAL MARKETING AND ADMIN COST

Cash Budget
Budgeted Income Statement
Budgeted Statement of Financial Position
. As of December 31, 2021, the Statement of Financial Position of the firm is as follows:

Company
Financial Position
er 31, 2021
Pesos)
Liabilitites and Equities
Current Liabilities
Accounts payable 140,000
Taxes payable 156,000
Current portion of long- 83,000
Total current liabilities 379,000
Long term liabilities 576,000
Total liabilities 955,000
Equity
Share capital 350,000
Retained earnings 1,305,000
Total Equities 1,655,000
Total Liabilities and Equities 2,610,000

ster Budget for 2022.

6,400
800

900 units @ 500

1,000

Material
R S
units 3 5
2,200 4,000
1,300 4,600
10.00 30.00
146 per unit produced

als and supplies 5.85 per unit produced

9.07 per unit
5.07 per unit

175,000
 85,000
173,000
87,000
280,000
43,000
117,000
41,000

40.625 per unit sold

16.25 per unit sold

100,000
193,000
78,000

254,000
103,000
professional fees 180,000
building, furniture and equipmen 94,000
160,000
26,000

tion and estimates

are expected to amount to P5,185,000
iation of P275,000 will be sold at its net book value. New equipment costing P320,000 will be purchased during the year.
d to be for materials purchases only.
% of income before taxes while P252,000 will be paid during the year.
he year and the current portion of the long-term debt shall also be settled at the end of the year. Interest rate is 8% per annum.

ar ending 2022:

For 2022
Total sales revenue
5,120,000

For 2022
6,400
1,000
7,400
-900
6,500
 5 units
S
32,500
4,600
37,100
-4,000
33,100.00
30
993,000.00

6,500
146
949,000

6,500 units
38,025
58,955
32,955
129,935

175,000
85,000
173,000
87,000
280,000
43,000
117,000
41,000
1,001,000
1,130,935

For 2022
S
Units Unit Cost Cost
4,000 30.00 142,000.00
Cost

260,000
104,000
364,000

100,000
193,000
78,000
371,000
735,000

254,000
103,000
180,000
94,000
160,000
26,000
817,000
1,552,000
ng the year.

e is 8% per annum.